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James Hyerczyk
E-mini NASDAQ-100 Index

March E-mini NASDAQ-100 Index futures finished lower on Friday as the technology-based index fell in sympathy with the benchmark S&P 500 Index and the blue chip Dow Jones Industrial Average, which were pressured by weakness in the banking and energy sectors.

If there was common ground with the other majors, it was weaker than expected U.S. economic data and worries about the cost of the Biden stimulus package. Also weighing on prices may have been simmering tensions between the United States and China.

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On Friday, March E-mini NASDAQ-100 Index futures settled at 12802.25, down 98.75 or -0.77%.

Perhaps generating some early pressure on Friday was weakness in technology stocks in Asia. Shares of Chinese smartphone maker Xiaomi plunged on Friday trade after U.S. President Donald Trump’s administration placed the firm on a blacklist of alleged Chinese military companies. By Friday’s close in Hong Kong, shares of Xiaomi listed in the city dived 10.26%.

In other news, investors may have trimmed some of their long positions as they assessed the impact of President-elect Joe Biden’s coronavirus relief plan on the economy and the potential for higher taxes. In economic news, U.S. consumer confidence fell and retail sales dipped 0.7% in December, raising concerns over a slowing economy.

Daily March E-mini NASDAQ-100 Index

Daily Swing Chart Technical Analysis

The main trend turned down on Friday when sellers took out the previous main bottom at 12767.25. A trade through 13028.75 will change the main trend to up, while a move through 13125.00 will reaffirm the uptrend. On the downside, potential targets are a pair of main bottoms at 12491.25 and 12461.00.

The minor range is 12491.25 to 13125.00. The index straddled its 50% level at 12808.25 late in the session on Friday.

The short-term range is 12217.00 to 13125.00. Its 50% level at 12767.25 is potential support.

The main range is 10936.25 to 13125.00. Its retracement zone at 12030.50 to 11772.25 is potential support and a value zone. It is also controlling the near-term direction of the index.

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Short-Term Outlook

We’re going to be looking at two levels when cash market trading resumes on Tuesday, following Monday’s U.S. bank holiday.

Bullish Scenario

A sustained move over 12808.25 will indicate the presence of buyers. If this move creates enough upside momentum then look for the rally to possibly extend into the first main top at 13028.75. Taking out this level could lead to a test of the record high at 13125.00.

Bearish Scenario

A sustained move under 12671.00 will signal the presence of sellers. This could trigger a quick break into 12491.25, followed by 12461.00. The daily chart starts to open up to the downside under this level with 12217.00 the next potential downside target. This main bottom is the last potential support before the 12030.50 to 11772.25 main bottom.

For a look at all of today’s economic events, check out our economic calendar.
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